Canarc goes underground at Polaris Taku gold project

Canarc Resource (CCM-T) has begun the underground phase of its feasibility program at the Polaris Taku property in northwestern British Columbia.

The work will entail drilling some 200 holes in an attempt to increase the current contained gold resource of 1.4 million oz. and define a minable reserve of at least 720,000 oz. (sufficient to complete a bankable feasibility study for production within 16 months).

Drilling last year increased the geological resource to 3.6 million tonnes grading 0.4 gram gold.

Initially, work will focus on rehabilitating, sampling and drilling the upper workings of the mine, Canarc says. One mining crew and one drill will be active until the Christmas break.

The company says its immediate goal will be to test for both new resource ounces as well as new minable reserves in the A,B and Y vein systems of the upper mine levels.

Next year, Vancouver-based Canarc wants to increase the site personnel to two mine crews and 2-3 drills to facilitate dewatering, sampling and drilling of the lower mine levels. The objective of that work will be to delineate minable reserves within the existing resource areas of the C and Y vein systems.

Polaris Taku is about 67 km northeast of Juneau, Alaska, near the Tulsequah River. A high-grade underground mine produced 231,000 oz. from 1938 to 1951.

Canarc acquired the 231,000-acre property in 1991.

Engineering, environmental, metallurgical and permitting studies are ongoing, and Canarc says its preliminary economic studies indicate that Polaris Taku could become a profitable, mid-size gold mine in 2-3 years.

The base case proposal calls for production of 90,000 oz. gold per year for a minimum of eight years at a capital cost of US$50 million and operating costs of $220 per oz. An extended-case proposal would see production increase to 145,000 oz. per year for an extra US$17 million in capital expenditures, with cash costs reduced to US$200 per oz.